10-year-old runs Amazon business

10-yr-old runs Amazon business

Amazon has made running an online retail business so easy that even a 10-year-old can do it.

Max Singer of Chula Vista, started selling iPad and iPhone covers online about two years ago.

"My dad wouldn't buy me everything I wanted," Max explained. "He told us to make our own money, so I had the idea to start my own business."

Max inherited his entrepreneurial spirit from his dad, Ricardo, who runs a company installing network systems for businesses. Now the 10-year-old is one of 2 million independent sellers worldwide who make up the Amazon Marketplace, an online store that enables sellers to offer their new and used merchandise alongside Seattle-based Amazon.com's own seemingly limitless inventory.

He started by selling iPad cases, because his friends at school loved to sport cool covers for their electronics, so he knew there was a market for them.

Then, with his dad's help he researched his competition, browsing the various purveyors of cases and covers on online marketplaces.

He and Ricardo found a manufacturer in China who made products of the quality they wanted, and then they settled on prices: Lower than the competition, but high enough to make a little profit.

They tried other e-commerce marketplaces, but Ricardo said listing on Amazon changed the game for Max's company, SingTech.

Tips for Selling on Amazon

Be as detailed as possible with your product listing.

Upload images.

Have a wide selection.

Study and engage the competition.

Put quality and customer service first.

Respond quickly to orders and customer questions.

Deliver on promises.

Sources: Erik Fairleigh, Max Singer and Ricardo Singer

It was months after the first item went up on Amazon before it sold. That first order sent sales snowballing. They don't know why. But when the orders began coming in at the rate of 300 per day, the young entrepreneur raised his prices to make the workload more manageable. He couldn't stay up until 2 a.m. fulfilling orders anymore.

"We were selling about $35,000 worth of products per month, but the profit margins were very small," Ricardo said.

They ran the numbers to figure out how to cut back on the work load while achieving greater profitability, and now Max gets between five and 20 orders per day now – a bit easier to handle between his school and Tae Kwon Do training.

Since launching SingTech, Max has added iPhone cases, Samsung Galaxy S3 covers, charger cables, outlet boxes and charger covers to his inventory. Meanwhile, he has also tweaked his packaging to include stickers and bubble wrap, along with business cards.

In exchange for between 8 percent and 25 percent of each sale, Amazon offers entrepreneurs like Max e-commerce and payment processing software that work seamlessly, along with a reputation of trust and a global reach. Meanwhile, online dashboards offer a host of data to sellers.

And sellers don't have to pay Amazon a dime for the dashboard and listing tools until they actually sell something. Professional sellers can choose to pay $40 per month for a more robust dashboard.

For those who choose to share a larger percentage of each sale, Amazon handles the shipping and the customer care for them with its Fulfillment by Amazon service.

That program, which has taken a bad rap recently for commingling branded and knockoff products, grew 65 percent last year. Three-quarters of business owners who participated in it reported an average 20 percent increase in sales, Amazon said in its annual report.

Max opted out of Fulfillment By Amazon, he said, because it would cost him more than shipping the products himself

Now Max spends about 20 minutes per day packaging items with his younger brother Alec and sister Sara. He comes home from school, has lunch, reads off the invoices, packs up the products and labels them, then runs them to the post office with his mom, Leah.

Entrepreneur Max Singer, 10, decided to start a home business as an Amazon marketer of iPhone and iPad cases.
— Peggy Peattie

Entrepreneur Max Singer, 10, decided to start a home business as an Amazon marketer of iPhone and iPad cases.
— Peggy Peattie

He also regularly tests products and handles returns, exchanges and customer service complaints. Ricardo makes the listings and occasionally advises on how to reply to customers. Even though Amazon is easy, Max said running an e-commerce business is more work than it looks.

"The biggest challenge for me is to manage when I have to get in and work after school, and then eat and do my activities all in one day with little time to spare," he said. "The hardest part is fulfilling the orders on time."

It's not easy, he said, but it's worth it. He now makes between $2 and $3 profit on each item. His parents let him spend some of the money, and he saves the rest.

He has about $500 in his bank account so far, and plans to use some of it for college.

Amazon spokesman Erik Fairleigh said Max's story is one of many unique stories among online sellers. The beauty of Amazon Marketplace, he said, is that it gives business owners the tools to run exactly the type of online retail store they want to.

"We just want to get out of the way and let these businesses run their own business," he explained.

One of the most valuable benefits for an Amazon seller, Fairleigh said, is having digital shelf space in front of the world's largest built-in customer base.

"For companies like SingTech, driving customer traffic to their site is a huge lift for them," Fairleigh explained. "As the proliferation of online sales grows globally, we're offering these businesses an opportunity to reach anyone in the world."

About one-third of consumers start their product searches on Amazon, according to a well-cited study from Forrester. And last year, Marketplace sellers sold more than 1 billion items – more than 13 million of them on Cyber Monday alone – accounting for about 40 percent of the e-commerce leader's total units sold.

There are entire specialty categories on Amazon that are populated solely by independent sellers, including collectibles, fine art and wine.

"Our sellers are a huge and invaluable part of the ecosystem on Amazon," Fairleigh said. "And for business owners, the best way to compete with Amazon is to sell right alongside Amazon."

And without those businesses, the colossus in Seattle wouldn't have an almost-infinite product selection and it wouldn't make about 40 percent of its sales.

That's why Amazon invests in tools and personalized training that make it easy for entrepreneurs to get started and stay going or to grow, Fairleigh said.

"In Max's case, the fact that a dad opened this seller account and a 10-year-old runs it really speaks to the intuitiveness of our tools," he said.

Another bonus for all sellers is consumer confidence in the payment process. With many consumers thinking twice before they enter their credit card information online, especially to purchase something from a new and unproved business, Amazon offers a track record of success and fraud protection.

Ricardo said Amazon's platform trumps all the others he and Max tried when they first launched SingTech. It's customizable, he said, it's easy to use and the community holds both buyers and sellers accountable. It's also a great platform for training his children in how to manage commitments, money and crises.

"I hope to see Max take it to the next level, but it's up to him," he said. "That's the beauty of the platform: You are 100 percent in control of your future. If he wanted to close it up tomorrow, he could."